Indonesia uncovers nearly USD600mn in first month of tax amnesty

• Indonesia’s second tax amnesty programme in the space of five years has unearthed nearly USD600mn of unreported assets in its first month, official data showed, as some analysts warned against repeating such programmes too often.
• President Joko Widodo launched the six-month tax amnesty on 1 Jan 22, though he did not announce a target for asset declaration or revenue.
• The programme allows participants of the president’s first tax amnesty, held for 9 months in 2016 to 2017, to disclose any assets not declared in the first round. Taxpayers can also declare un-reported assets acquired between 2016 to 2020.
• Authorities will regard declared assets as additional income and tax them at between 6% to 18%, far higher than penalty rates in the earlier amnesty.
• The government described the first amnesty as one of the world’s most successful after it uncovered more than USD300bn of assets, resulting in more than USD9bn in revenue from penalties.
• Both amnesty programmes were aimed at improving compliance in a country where less than half of the workforce are registered taxpayers.
• Official data showed 9,276 taxpayers joined the programme in Jan 22, declaring IDR8.47tr (USD590.9mn) of assets and with IDR903bn of revenue collected.
• Wahyu Nuryanto, a partner at tax consultancy MUC Consulting, said while authorities had not set targets, the number of participants in Jan 22 was less than 10% of the previous amnesty.

External Link : https://www.reuters.com/markets/rates-bonds/indonesia-uncovers-nearly-600-mln-assets-1st-month-tax-amnesty-2022-02-02/